ISTAT Jetrader - Autumn 2022 - 35

Year of
Build
2014
2015
2016
2017
2018
2019
2020
2021
2022
Current
Lease
Rate
0.600
0.650
0.700
0.750
0.800
0.850
0.900
0.950
1.000
Current
Market
Value
82.3
87.6
94.1
100.1
105.6
112.0
116.9
121.8
149.9
Boeing 787-9 - Collateral Verifications, LLC Values at 30 June 2022
Future Base Values at 2.0% inflation
Current
Base
Value
86.6
92.2
99.1
105.4
111.2
117.9
123.1
128.2
156.2
2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
82.2
87.4
94.0
78.0
82.9
89.1
100.0 94.8
74.0
78.7
84.6
90.0
105.5 100.1 94.9
70.2
74.6
80.2
85.3
90.0
111.8 106.1 100.6 95.4
116.8 110.8 105.1 99.7
66.6
70.8
76.1
80.9
85.4
90.5
94.6
121.6 115.3 109.4 103.8 98.5
63.1
67.2
72.2
76.8
81.0
85.9
89.7
93.4
56.7
63.7
68.5
72.8
76.8
81.5
85.1
88.6
50.9
57.2
64.9
69.1
72.9
77.3
80.7
84.0
45.7
51.3
58.3
65.5
69.2
73.3
76.6
79.7
148.1 140.5 133.3 126.5 120.0 113.8 107.9 102.4 97.1
41.0
46.1
52.3
58.8
65.6
69.5
72.6
75.6
92.1
36.8
41.4
47.0
52.8
58.9
66.0
68.9
71.7
87.4
33.0
37.1
42.2
47.4
52.9
59.2
65.4
68.0
82.9
Aircraft specifications: Engines - Genx-1B74/75 or Trent 1000-J, MTOW - 560,000lbs
Assumptions: Aircraft and all of its major components will be in a " half time " condition as per the current maintenance program and overhaul
intervals for the respective components. All mandatory airworthiness directives are up to date and have been complied with. The aircraft are
assumed to have no damage history and be in good condition.
Future Values: As of May each year.
All values in $US millions
29.6
33.3
37.8
42.5
47.4
53.1
58.7
64.5
78.6
do expect Boeing to get past these
hurdles and ramp up production again
to pre-pandemic levels to meet the
demand that we believe is coming in
the widebody market. With over 1,500
orders since launch, the 787 family of
aircraft has already shown great signs
of success in comparison to the A330
and 767, which it is meant to replace.
And with no replacement in the pipeline
for the 787, orders should continue
to grow over time. Going forward, we
expect the 787-9 variant to remain
the most popular among operators
and investors alike. The 787-9 offers
improved seat mile economics and
greater cabin flexibility over the 787-8
to better meet passenger demand,
which we feel is more compelling to
operators. We fully expect the 787
to continue replacing aging 767s and
A330s as operators look to operate the
most efficient aircraft.
The 787-9 has strong competition
from the A350-900, which entered
service in 2015. The A350-900 offers
about 10% more seats in standard
We fully expect the 787 to continue replacing aging
767s and A330s as operators look to operate the most
efficient aircraft.
configuration with slightly less range.
Boeing claims that the 787-9 offers
better economics, but CV believes that
both aircraft will do well going forward,
in terms of demand and residual values,
as demand for long-haul capable midsized
widebodies strengthens over the
next few years.
For both of these aircraft, however,
there have been recent concerns from
investors about the potential future
residual value impacts on engines of
OEM engine maintenance programs
such as RR Total Care or GE True
Choice. Due to these programs, there
is a feeling that it may become more
difficult to remarket these engines,
as the OEM retain such high level of
control with their respective engines.
The engine OEMs are aware of this
issue and are trying to determine the
best course of action to provide a more
liquid marketplace without adversely
impacting profitability. CV believes that
this will take some time but that at
some point in the not-so-distant future,
there will be more third-party facilities
able to maintain these engines, thereby
creating a secondary market for the
GEnx and Trent 1000. Until then, the
marketability of these engines may be
viewed as challenging.
Overall, and due to the lack of
any potential replacement for the
foreseeable future, CV believes the
787 family, and in particular the 787-9,
will perform well for many years to
come and will continue to be one of
the top aircraft choices by operators
and investors.
Jetrader * AUTUMN 2022 * 35
ISTAT Jetrader - Autumn 2022

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